How much of the company budget should you invest in your marketing strategy? What marketing activities will you prioritize? What should you expect from specific marketing campaigns? Without setting up well-defined, ROI-driven marketing goals, you can’t answer these questions.
And by marketing goals, we don’t mean key performance indicators (KPIs) or SMART goals. Don’t get us wrong: these models are great. However, these frameworks focus strictly on what needs to be done without considering the overall business growth or the ROI. And although the models we’ve mentioned above are great at defining marketing goals, they aren’t so good at evaluating the tangible impact your campaigns will have.
We need to reinvent the way we define our marketing goals, making sure they will help us:
- Identify what success looks like
- Prioritize work
- Provide the greatest opportunity for impact
- Transform long term vision into efficient actions
- Evaluate marketing ROI easily
- Map what works and what doesn’t
Modern marketing goals provide a clear roadmap while leaving space for agile improvements, increased adaptability, and resistance to uncertainty. This is possible because they are derived from the impact a marketing team wants to generate.
Instead of using the traditional KPIs or SMART goals framework, we developed a new model that helps us design our quarterly objectives and key results (OKRs).
The Importance of ROI-Driven Marketing Goals
What’s the difference between regular and ROI-driven marketing goals? Common goals stem from the need to improve KPIs. Whether to increase the organic website traffic or the number of MQLs, your goals will always focus on immediate marketing results.
When setting up ROI-driven marketing goals, though, these KPIs or immediate marketing results are part of a bigger picture, allowing you to identify elements, such as:
- Your output or the actions you’ll need to take
- The outcome, or how your indicators changed
- The impact, or the overall business value you’ve generated
When setting up marketing goals, many people focus mainly on the actions and the immediate results they hope that these actions will create without considering the bigger picture. They also tend to separate marketing goals from marketing ROI, which is calculated once a campaign ends.
On the other hand, our model invites you to start by analyzing the strategic value of an action and its outcome. In other words, when setting up modern marketing goals, begin by identifying the impact a specific marketing campaign should have and the ROI you want to produce.
This approach translates into defining the impact, the outcome, and the output, or the actions you should take. Let’s take them one by one.
Impact: Evaluating the Strategic Value Generated By Outcomes
Start with high-level thinking by asking yourself the following questions:
- What strategic value do I want to create?
- What ROI do I plan to generate?
The answers to these questions should derive from your current situation and your overall business OKRs. For example, you may identify that your marketing campaigns should produce impact such as:
- Annual Recurring Revenue (ARR)
- Customer Lifetime Value (CLV)
- Customer Retention Rate (CRR)
- Average Revenue per Account (ARPA)
- New User Acquisition (UA)
Once you’ve identified your areas of impact, you can get more specific, stating, for example, that you want to increase:
- ARR by $1M
- CLV by 5%
- CRR by 10%
- ARPA by 25%
- UA by 15%
Knowing what impact you want to generate will help you understand what to prioritize when designing your marketing strategy and action plan.
Outcome: Identifying the Results You Want To Create
The next step is to list what needs to happen so that your marketing campaigns can create the impact you want. In other words, you have to ask yourself the following questions:
- What results do I expect to achieve through my marketing actions?
- Which outcomes will contribute to generating the impact I want?
Obviously, the outcomes will derive from the impact areas you’ve listed previously. For example, you may discover that to increase the UA by 10%, you need to ensure outcomes such as:
- Grow organic website traffic by 15%
- Attract 20 new referral partners
- Generate 100 free trial users
Or for example, if your impact is to increase your ARR by $1M, you may identify the following outcomes:
- Acquire 300 new users
- Transform 100 freemium users into paying customers
- Generate 50 SQLs for Sales
This exercise will land your high-level thinking, helping you identify the numbers and outcomes to pursue.
Output: Defining What Actions To Take
Finally, you have to decide what actions will help you achieve your identified outcomes. Each outcome may translate into one or more actions. It all depends on your resources. Also, it’s essential to consider the impact it will generate. In other words, you’ll want to predict your ROI, knowing more or less how much you’ll invest in a specific marketing campaign and the results it may create.
Having this in mind, let’s say you want to increase your UA by 10%, and you’ve identified three outcomes. And each outcome involves several outputs or actions. Let’s take three outcome examples from above and see what outputs they may involve:
Grow organic website traffic by 15%
- Design a programmatic SEO strategy and launch 50 new landing pages.
- Write and publish 5 pillar pages.
- Launch a webinar marketing campaign. Partner up with a webinar platform and run 5 top-of-the-funnel virtual events.
Attract 20 new referral partners
- Run a client engagement campaign by creating a course geared at a particular segment/industry.
- Launch a community to ensure user engagement.
- Design a relationship marketing or live marketing strategy, and run VIP events to improve customer engagement.
Generate 100 free trial users
- Create an engagement strategy by running demo webinars geared to a particular segment/industry.
- Write 5 pieces of educational content for bottom-of-the-funnel leads.
- Publish 10 customer story videos on YouTube.
Once you have the actions you need to take, you can also add the resources it will take to make them happen and the possible ROI they’ll derive.
The Impact, Outcome, and Output Framework
Think about the Impact, Outcome, and Output (OOI) Framework as a top-down approach to marketing goals. For example, when setting up SMART goals, we focus less on the bigger picture and more on the output. In other words, we deploy a bottom-up approach. These SMART goals must be specific, measurable, achievable, relevant, and time-bound. As a result, these goals are heavily focused on the output instead of the impact.
For example, a SMART goal can be to increase organic website traffic by 15% by the end of the year. Although it has all elements, meaning it’s specific, measurable, achievable, relevant, and time-bound, this goal doesn’t reflect the strategic value or its impact on your overall business.
The Impact, Outcome, and Output Framework, on the other hand, is heavily focused on evaluating the overall effect a marketing action will have on the outcomes and, subsequently, on overall business growth.
In other words, instead of deciding the immediate actions or marketing campaigns we need to roll out, we have to identify the overall business result we want to achieve along with the outcomes that will help us do that. And only then can we determine the actions that have the potential to generate the outcomes that will have strategic value for our company.
What does an impact-focused marketing goal look like?
If you’re still unsure how to set up marketing goals based on an OOI framework, be comforted by the knowledge that although they carry a lot of information, OOI marketing goals shouldn’t be complicated. Let’s say that your business impact is to increase your company’s ARR by $1M. To do that, you have to acquire, as an outcome, 300 paying users. Having this in mind, we can set the OOI marketing goal, which can be:
- Run 5 bottom-of-the-funnel webinars, publish 10 success story videos, and streamline the self-serve user onboarding process to acquire 300 paying customers and increase the company’s ARR by $1M.
As you can see, the OOI marketing goal contains all elements, starting from the actions you should take, the outcomes they’ll generate, and their overall strategic value on your business’ growth.
Always think top-down when setting up your marketing goals. Although it may be tempting and easier to start listing all the marketing actions and campaigns you want to run, remember that you need to see the bigger picture first. Start by looking at your business OKRs, understanding your growth priorities and the impact you want to create, and then land this bigger idea by breaking it down into outcomes and specific actions.
*If you want to run events and webinars as part of your ROI-driven marketing goals, check out Demio, a webinar platform built with engagement marketing at its core. Demio is perfect for building and nurturing strong relationships with your audience and one of our customers did just that, achieving a 5x conversion rate via their weekly sessions. Talk to our team if you’re ready to see your own incredible results with your webinars.